War and crisis will also shape 2023

Putin (left) and Xi

Russia’s war against Ukraine has shaped this year, in 2023 the situation between China and Taiwan could become more tense.

(Photo: via REUTERS)

Vladimir Putin’s attack on Ukraine defined the year that was coming to an end like no other event. Russia’s aggression marks a turning point: war is raging again in Europe. “Turning in time” is the new geopolitical “normality”. It is to be feared that Russia’s attack will turn into a tough war of attrition and will also shape the year 2023. Because, as history shows, peace agreements are only realistic if the warring parties have come closer to each other in assessing the further course of the fighting.

However, Russia’s president and his Ukrainian opponent have so far had completely opposite ideas about the end of the war: Putin wants to build a new Greater Russian Empire and is continuing the attacks on the civilian Ukrainian infrastructure in order to break the will of the population to resist. President Volodymyr Zelensky, on the other hand, wants to use Western military and financial aid to drive the invaders out of the country and recapture Crimea, which has been occupied by Russia since 2014.

The Ukrainians are doing everything they can to avoid falling under the yoke of the Kremlin dictatorship. It is therefore not clear how this contrast could be reduced to a common denominator. As things stand, the signs still point to war.

But could the world face an even greater catastrophe in 2023 with a Chinese invasion of Taiwan? The People’s Liberation Army has already practiced the sea and air blockade of the island state this year. And China’s autocrat Xi Jinping declared in October that the “renegade province” would have to be “forcibly” incorporated into the Red Empire if necessary.

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However, it is precisely the war in Europe that raises the inhibition threshold for a military adventure: China’s leadership can use the sanctions against Russia and the financial and arms aid for Ukraine to study how much a war against Taiwan would undermine its own plans the world’s strongest economy.

Return of the USA as European regulatory power

Ultimately, even the “business model” of the political elite would be in danger: the people have to forego political participation rights in favor of growing prosperity.
It is therefore no coincidence that the Chinese protests against the now-abandoned zero-Covid policy were not only aimed at restricting civil liberties, but also at the threat of a loss of prosperity.

Ukraine War – Zurich

Demonstrators take to the streets against the Ukraine war.

(Photo: dpa)

Beijing’s goal of increasing gross domestic product by 5.5 percent in 2022 has long been obsolete. In addition, according to US military experts, China still needs about four years to comprehensively modernize the People’s Liberation Army. All of this suggests that in 2023 the signs are not pointing to war between China and Taiwan.

Against this background, the return of the USA as a European regulatory power, initiated by Russia’s aggression against Ukraine, should also last in the coming year. Even if the new Republican majority in the House of Representatives were to oppose the continuation of massive military aid to Ukraine, President Joe Biden is likely to enforce the aid by executive order.

He will also be able to do without this instrument in 2023 when approaching the strategic goal of curbing China’s global influence: If it goes against Beijing, Biden is sure of cross-party approval.

The Europeans burn billions of euros

Republicans and Democrats will do everything they can to keep China away from sensitive telecommunications and surveillance technology and to become independent of imports from the People’s Republic. A lot for Europe’s companies depends on how badly they will be affected by US sanctions against China.

Joe Biden

The US President has arranged for massive arms deliveries to Ukraine and has given it strong support in the war against Russia.

(Photo: dpa)

Biden’s course of decoupling towards the People’s Republic fits into the general framework of his protectionist economic policy. The subsidization of US technology associated with the Inflation Reduction Act and the blocking of arbitration by the World Trade Organization (WTO) provide only the most visible evidence of this. Difficult times are coming for multilateral trade. The WTO only expects world trade to increase by one percent in 2023. This is extremely bad news for the export-oriented German economy.

In the face of war and crises, the European Union should actually make greater efforts to become “strategically independent”. But so far nothing indicates that. Realizable large-scale projects for the further coordination or communitarization of national policies are not in sight. Only the armaments expenditures should increase. It would make more sense than simply spending more money to leverage the existing efficiency reserves. The armed forces of the 27 EU countries use a good 160 different weapon systems – five times as many as the USA uses. Europeans are burning billions of euros – money that could be far more wisely invested in 2023 to fight the climate crisis.

The authors: Bert Rürup is President of the Handelsblatt Research Institute. Michael Brackmann is a journalist.

More: Europe is light years away from strategic sovereignty

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